PHILADELPHIA, PA — Administrative expenses in Medicaid-focused health plans increased at a slower pace in 2024, signaling cautious cost management amid ongoing federal and state policy uncertainty. According to the latest Sherlock Benchmarks report, core per member administrative expenses rose 5.0% in 2024, down slightly from 5.3% growth the prior year.
Total administrative expenses increased 3.6%, compared with 5.4% in 2023, based on consistent plan universes and product mixes. Median core costs reached $44.49 per member per month (PMPM) across all health plans, while Medicaid-specific median costs were lower at $36.08 PMPM.
The findings, published in the Plan Management Navigator from Sherlock Company, draw from data provided by 14 Medicaid plans serving 9.4 million members. Including data from other benchmark universes, the analysis represents at least 14% of the national Medicaid market—and 28% when excluding publicly traded insurers.
Sherlock’s benchmarking data has long served as a key reference for health plans seeking to measure administrative efficiency. With the reinstatement of Medicaid redeterminations and heightened scrutiny over Medicaid and Affordable Care Act (ACA) funding in the 2025 federal budget discussions, the firm’s data provides a timely lens into cost performance and operational resilience.
Now in its 28th year, the Sherlock Benchmarks database reflects more than 1,000 health plan years of data across Medicaid, Medicare, Blue Cross Blue Shield, and provider-sponsored plans—serving over 170 million members nationwide.
Health plans use the data not only to assess administrative cost levels but also to identify opportunities for efficiency, support strategic planning, and inform cost-benefit analyses.
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